Category Archives: Business

Artificial Intelligence and Accounting – The Challenge of ‘Now’

Although we can understand the past (what we’ve experienced) and try to predict the future (what we can dream up), often the most difficult thing to understand is what is happening RIGHT NOW. And nowhere today is that more true than in artificial intelligence.

Over the last couple of years, we’ve all heard buzzwords such as ‘artificial intelligence’ a million times. And there is no doubt that the buzz is real; the resulting advances will change the way we work and live in a fundamental way. According to Andrew Moore, Dean of the School of Computer Science at Carnegie Mellon University, “Artificial intelligence is the science and engineering of making computers behave in ways that, until recently, we thought required human intelligence.”

When it comes to AI, on the one end of the spectrum – let’s call it ‘The Sky Is Falling’ view – the questions are along the lines of ‘How long until I lose my job to a robot?’On the other end – let’s call it the ‘Pie in the Sky’ view – the questions more closely resemble ‘How long until I can live comfortably without working so much since AI will be doing my time-consuming work?’

Our own mental model of the world is shaped by past experiences. When something completely new comes into existence – like the Internet in the 90’s – it’s takes some adjusting to wrap our brains around what it means and how to use it. You don’t have to look very far on Facebook to see that many of us are still on the social media learning curve – ourselves included!

On the other end of the spectrum, our ability to dream helps us to see what is possible in the future. Movies have always tried to predict what the future will look like, sometimes with creepy accuracy…and sometimes not. I looked up a few big misses, and they included gems from movies like Back to the Future II, which showed at various points both restaurants with workout bikes and people floating around on hoverboards (not to pick on this movie too much as it also basically predicted the Cubs winning the World Series after a 100+ year drought). We don’t always get the future right, but many people enjoy thinking about what could be possible.

Although we can understand the past (what we’ve experienced) and try to predict the future (what we can dream up), often the most difficult thing to understand is what is happening RIGHT NOW. And nowhere today is that more true than in artificial intelligence. I’m sure that each of us have two kinds of stories – the first kind involving ‘wow’ experiences (“I can’t believe this system is that smart/helpful/amazing”) and the second kind quite the opposite (“I can’t believe it’s 2019 and this device still can’t do X, Y, or Z”).

Terra and I had the second type of experience while navigating through Seville, Spain, a couple of years ago. I made the mistake of driving towards the center of the old town, and we found ourselves on roads that were so narrow that the sidewalks were essentially acting as rails on both sides. A couple of restaurants had to move a few tables for us to get around them! We were guided to this perilous location by our helpful Google Maps assistant. Worse yet, when we got to a pedestrian square, her directions basically indicated that we needed to stop, pick up and carry the car across the square, and continue on our merry way. Yeah right!?!

Existence in this seemingly perpetual transitory state can seem confusing at best and irritating at worst. Every intelligent system we use (and the companies behind them) are continually trying to improve, but we are (sometimes painfully) living through their growing pains. Technological advances have absolutely enabled us to say “Yes, we can help” to just about every single problem/issue that a client can come to us with.

This is no less true in the Accounting industry. On the one hand we (as Accounting professionals) are experiencing amazing times because of this technological improvement. We are constantly finding new ways to utilize cutting-edge technology to solve business problems. Although we do encounter a lot of similar issues, there are occasions for new problems to come to the forefront. And when that happens, we invariably say ‘I’m sure there is a solution for that!” And then we invariably find it. Technological advances have absolutely enabled us to say “Yes, we can help” to just about every single problem/issue that a client can come to us with.

But the important thing to realize is that artificial intelligence is in many ways in its infancy, and therefore as a small business owner it’s critical to have professionals by your side who have ‘seen it all’ and understand the pitfalls and challenges associated with each system. Despite the amazing progress we’ve made, businesses still need trained professionals who know how to scout out the errors or anomalies in an imperfect software world.

We at Joy Accounting have built a library of knowledge based on these particulars, including how well specific systems work together (or not). Recently we noticed some minor calculation errors in one of our accounting programs that, had we not known what to look for, would have gone unnoticed and could have affected clients negatively. This latter example is more related to automation than AI per se, but the same idea applies – you need someone who knows the ins and out of the software you are using by your side. Despite the amazing progress we’ve made, businesses still need trained professionals who know how to scout out the errors or anomalies in an imperfect software world.

I’ll leave you with a Forbes article from 2018. Although the article clearly suggests that artificial intelligence is the future of accounting (in fact that’s in the title!), it also states that “Despite being very promising, the accuracy of the machine learning algorithms used in most of today’s solutions still needs to significantly improve in efficiency to avoid accounting errors and really fulfill their promise of automation.”

Customer Success: More than a Feeling

March 1st is our three-year anniversary here at Joy Accounting! Special thanks to our team members, our customers, and everyone who has supported us. What better way to mark our anniversary than by sharing what we know about a topic near and dear to our hearts – customer success.

At Joy Accounting, we believe in asking a lot of questions, both of our customers and ourselves, to ensure continual improvement in every aspect of our business. Most of these questions center around one central theme – how do we ensure that our customers are experiencing success, an all-too-elusive goal for too many small businesses? Helping our customers obtain this ‘holy grail’ drives everything we do in our business.

But before we can help our customers, we work with them to define what success looks like in each case. Finding this “True North of Success” involves, of course, consistent tracking and improvement on tried-and-true metrics (including profitability, employee turnover, etc.). But the more challenging aspect involves identifying the aspects of success which are unique. Discovering these individual success markers involves answering some simple but profound questions covering everything from why the business was started in the first place to what life values are most important. If you are a father of four young children, for example, a critical success factor could be spending more time with your kids as they grow up. We find that the personal side of success is every bit as important as the more obvious business metrics.

No small business owner wants to continually spin their wheels, grinding their way through year after year without ever experiencing the fruit of their labor. Despite this, anyone who owns a small business experiences ‘spinning wheels’ mode at least occasionally and many are perpetually in this mode. At Joy Accounting we really strive to help owners take a step back and get off the wheel!

Recently in one of our internal brainstorming sessions our team came up with a number of characteristics that make a successful business. These recommendations to success are by no means exhaustive; please leave a comment if you have any additional ideas!

5 Recommendations for Small Business Success

Ensure your company Mission, Vision, and Goals are clearly articulated and consciously pursued

Many businesses fail because the owners don’t set their goals or purpose up front, and many others lose their way because the business veers off course due to a lack of strategic thinking built into the weekly cadence. As a business owner, it’s important to always have your vision, mission, and goals at the top of your mind, with every decision and tactic derived from these things.

Consider the following, among other questions. Why did you go into business in the first place? Who are your customers and what are you doing to attract them? What kind of lifestyle do you want to live while you are getting your business going, and will this change in 5 years? How often do you look to see whether you are aligning with your mission/vision/goals, and what do you do if you aren’t on track? Without a specific blueprint and a focus on adhering to that blueprint, it’s easy to get blown off course and simply move to survival mode.

Keep a finger on the pulse of your business

Many businesses are constantly in ‘fight or flight’ mode, fighting fires all day, every day. If you don’t take your head out of the sand, your business can be a long way off from where you want it to be – even you are busy serving a ton of customers. As an owner, you absolutely need to identify your key metrics and check them, at least monthly.

Discover one or two things holding you back and focus on improving those things

Of course, the next step in keeping a finger on the pulse of your business is determining what the metrics mean – that is, identifying what can be improved.  If your profitability is low, is it because you are behind on invoicing or because your processes aren’t crisp?  Once you discover what is wrong, develop a process that works, ensure everyone is on the same page, and focus in a laser-like manner on correcting it. This is harder than it sounds, as these areas of improvement typically will come from a blind spot, so it won’t feel natural at first. Never fear, though, when you focus on improvement in this area and see improvement in a short time you will feel great and your business will be on a much better track. Then you can focus on the next area of potential improvement!

In addition to keeping up on metrics, small business owners should continually look for processes that are broken or inefficient and work on fixing them. One broken process can create a lot of wasted time, money, and resources, and it can possibly be the difference between success and failure.

Confirm that everyone knows their role in making the company successful

First, of course, you need to understand your own role in the business. As an owner, you need to spend some of your time thinking strategically, setting goals, and tracking against these goals. So many business owners that we work with are burning the candle at both ends trying to do everything themselves. Sometimes this is necessary in the short-term but ensure that you are building a business that works for the long-term, and start by ensuring you are spending your own time on the right things that will lead to success.

Beyond your own role, it’s critical that your employees know exactly what their roles entail. As the owner, you need to come up with a specific job description for each employee and utilize that job description to track employee performance over time. Additionally, always be noticing what each employee excels in and use that knowledge to continue to evolve their position (or move them into a new position altogether).

One thing is certain – the overall success of your company is dependent on all of your employees being on the same page, so an effective hiring process is extremely crucial.

Do what you are good at while leveraging advisers outside of your core competencies

Small business owners are almost always very skilled and passionate about their craft; so why do so many fail? Part of the reason is that it’s very tempting for small business owners to try to run all aspects of the business – even those that are not really within their core competencies. This could include Human Resources, Accounting, or Sales.

Obviously, a small business owner can’t outsource everything, so deciding on the right things to outsource becomes a critical success factor in the business. When do you know that you’ve chosen correctly? A few possible times are: 1) When the outsourced company you are working with really ‘gets’ you and feels like an extension of your own team, 2) when the company you are working with is helping you improve your profitability, or 3) when you are feeling more relaxed and at ease about your business because you are more informed about what is going on.

Of course, at Joy Accounting this is exactly the type of partnership we aim to provide for our customers! If you have any questions or would like to ask about our services, please call Terra at 425.394.9747 or email her at terra@joyaccounting.com.